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Australia’s biggest cities face a challenge. On one hand, larger cities have significant economic advantages over smaller centres, and offer people a greater range and diversity of jobs, leisure and cultural activities. On the other hand, fast-growing cities come with growing congestion that requires people to adapt.

The challenge is particularly acute in times of rapid change. Over the five years to 2016, Sydney and Melbourne’s populations grew at rates among the highest in the developed world, by 1.9 per cent and 2.3 per cent each year. There was strong population growth from the Gold Coast to the Sunshine Coast, and in Canberra and Darwin.

So far, the impact of rapid population growth on commuting distances and times has been remarkably benign, despite regular media coverage claiming the opposite. The average commute distance barely increased over the five years to the most recent Census in 2016, and there has been little or no change in the duration of commutes.

The benign impact of population growth is due in no small part to the spread of jobs across cities. It’s a common misconception that jobs are centred in CBDs which get harder to access as cities grow. In reality, fewer than two in ten people work in CBDs, whereas three in ten work just a suburb away from home. The importance of suburban ‘employment centres’ is similarly overblown; Parramatta, for instance, is the location of only 2.3 per cent of Sydney’s jobs. Instead, three quarters of jobs are dispersed all over Australia’s major cities, in shops, offices, schools, clinics, and construction sites.

Even though commutes are not getting much worse, the level of congestion in cities is still a problem. There is overcrowding on public transport, and commuting times can be unreliable. While most drivers are delayed no more than five minutes getting to work, this number can be much higher on bad routes.

But the situation is not spiralling out of control; migration has not brought cities to a standstill. People adapt: some change job or worksite, and working from home is on the rise. Some people move house, or even leave the city; and some change their method of travel, leaving the car at home and catching the train or bus to work. Other people simply accept a longer commute – at least for a time – particularly if they earn a high income.

This is not to suggest that population growth has left everybody better off. Some people elect not to take a new job that’s too far from home; some pay higher rent or cannot afford a place they once could have. But it is to emphasise that people are not hapless victims of population growth, depending for their wellbeing on governments building the next freeway or rail extension. Cities have coped even though major infrastructure projects like WestConnex, Melbourne Metro and Cross River Rail have not yet been completed. We should be sceptical of “congestion-busting” election pledges. Building new infrastructure is far from the only way to cope with population growth.

Governments should not announce any projects before rigorously establishing their net benefits to the community. They should also focus on facilitating the natural adaptations people make. This means removing barriers to people and firms locating where they want to be. It means phasing out stamp duty, which effectively locks people into staying put when they otherwise might move house. And it means introducing congestion charges, so that drivers are encouraged to stay off the most congested roads at peak times.

With these changes, the benefits that draw people to live and work close together can outweigh the congestion and crowding that trigger demands to shut new people out.

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Grattan Institute Report No. 2018-13